I love cloud computing. I'm making a crapload of extra money with my SAAS site and have a couple more being developed by Indian software engineers right now.
There are drawbacks for the user, chiefly security, and reliability of the server and the connection. But desktop computers are not 100 percent secure or reliable either. The internet is now almost as reliable as any other utility and getting better and stronger all the time.
My customers have the advantages of being able to do business from any computer or mobile device. If their computer crashes or is stolen, they just get another and carry on because they only need a browser. Nothing to install and they only pay for what they use. They can suspend the subscription and reinstate it at a later date. They can assign user privileges to guests and work collaboratively with anyone in the world. If they want to quit, I email their data back to them and delete it from the server.
Upgrades and bug fixes can be deployed so easily now. Instead of contacting hundreds of customers about a fix or software revision, we just install it on the server and everyone gets it. It's made my life so much easier.
LPSG is a form of cloud computing. All your photos and friends and posts are stored on a server. None of it happens on your own computer. Same with GMail, your bank website, facebook, youtube. Yes it can and is abused. You have to protect yourself and secure your data backups and use some common sense. But it isn't all bad either.